2012

Nonparametric Structural Estimation of Labor Supply in the Presence of Censoring

Reprint No. 2012:15

Author(s): Che-Yuan LiangYear: 2012 Title: Journal of Public Economics Volume (No.): 96 (1-2) Pages: 89–103
Online article (restrictions may apply)


This paper extends the nonparametric structural method to estimate labor supply developed by Blomquist and Newey (2002) to handle cases in which there are individuals who do not work. The method is then applied to married women in Sweden from 1973 to 1999. I find an uncompensated wage elasticity of 0.98 and an income elasticity of -0.10, with the participation margin accounting for one third of the wage elasticity and two thirds of the income elasticity. The elasticities vary, however, a lot over time due to differences in tax systems and demographics. I also find results consistent with tax rates being around the net government revenue maximizing rates.


Reference:
Liang, Che-Yuan (2012), "Nonparametric Structural Estimation of Labor Supply in the Presence of Censoring". Journal of Public Economics 96(1-2), 89–103.

Interdisciplinary European Studies

The European Union and the Return of the Nation State

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This book explores the complex and ever-changing relationship between the European Union and its member states. The recent surge in tension in this relationship has been prompted by the actions of some member state governments as they question fundamental EU values and principles and refuse to implement common decisions seemingly on the basis of narrowly defined national interests.

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